into place, so...it's good. >> ♪ i can tell, i can tell ♪ she loves to go >> ♪ shop >> ♪ she's all out of control ♪ she can't >> ♪ stop >> ♪ designer clothes, jewels, hair ♪ ♪ she's throwing money everywhere ♪ ♪ my head is spinning ♪ head is spinning ♪ oh, oh, oh, oh ♪ she's a princess ♪ she's a princess ♪ she's a princess ♪ she's a princess ♪ modern-day princess hi, everybody. welcome to "the wall street journal report." i'm maria bartiromo. a bold move by the fed, a standstill in washington, and the fiscal cliff moves ever closer. my talk with the man behind the no tax increase plan, what grover norquist thinks what will happen next. is he a big loser in the negotiations? why companies may be looking for

the art history major rather than an engineering one. "wall street journal report" begins right now. >> this is america's number one financial news program. "the wall street journal report." now maria bartiromo. >> here is a look at what's making news as we head to a new week on wall street. the federal reserve goes where it's never gone before. at its meeting this week, the fed's open market committee announced a new target that it will keep interest rates low until the unemployment rate hits 6.5%. that's the target. that's the first time it has linked employment to interest rates. the fed also announced a plan to continue buying $40 billion a month in bonds to keep interest rates low. but, of course, the big news was about those jobs. >> the conditions now prevailing in the job market represent an enormous waste of human and economic potential. a return to broad-based prosperity will require stayed

improvement in the job market which, in turn, requires stronger economic growth. >> meanwhile, the fiscal cliff drove markets. the dow industrials broke a five-day winning streak on wednesday and continued to fall thursday on worries over the fiscal cliff. the markets continues down on friday. americans are still shopping, though. the commerce department said retail sales rose in november by .3%. rebounding from a fall the previous month. consumer spending, of course, makes up about 70% of the u.s. economy. if you have been missing the google maps app on your iphone, you should be able find it now. it's been three months since apple replaced google maps. that was not nearly as popular and not nearly as good. google released its free application this week, and it's expected to become one of the hottest commodities in the apps store. a bold move by the fed seemingly no moves at all when it comes to the debt ceiling and debt issues. two big stories. what do they mean and what happens next? joining me now is bob nardelli,

former ceo of home depot, former chairman of chrysler, and president of the private equity firm x lr-8. >> thank you. >> as a businessman, what is your take on the fiscal cliff issue? how do you think these negotiations end? >> well, i mean there, is so much speculation out there and such a broad range of opinions. i guess if i had to predict, i would say we probably will not reach agreement and there is a high probability we will go over the cliff, and the impact of that, the repercussions i think are catastrophic. >> that is the thing. we hear this from everybody if we go over the fiscal cliff it will trigger layoffs and trigger the possibility that the economy goes back into recession. in 2013, but the rhetoric again is ratcheting up between house speaker john boehner, senate majority leader harry reid, even though boehner met with the president again this past week, they are stuck on the sacred cows. how do you think it impacts business? from your standpoint what are

you hearing from some of your clients and business colleagues out there? >> well, again, there's quite a broad range of interpretation on this thing and perspective. it's interesting. i attended a ceo conference in washington with ceos, and there is a great amount of trepidation and conservatism about the future. and i was on the west coast and attended this strategic growth forum, with 2,500 entrepreneurs who were blowing and going. but, again, these are individuals who are generating about a million to $10 million to $25 billion. but the core ceos, i think, are very concerned about the future and being very cautious about their investments. i think you're starting to see announcements of potential layoffs. i think you're seeing a number of states not signing up for obamacare. so i think there is a ton of implications on this economy.

>> the fed did something this week it's never done before. and that is targeting an unemployment rate of 6.5% and tying it to low interest rates. that was a go ahead idea in your view? you never heard the fed talk a specific number in terms of unemployment, where they are going. >> i think it's mixed, right? there's good news/bad news. the good news is the ability to borrow and certainly will help the housing market. bad news is, you know, it doesn't give us much earning power on our savings. what was concerning to me in that was that they were projecting maybe 2015 before we got to 6.5% unemployment. that is a devastating projection from my standpoint of millions of people unemployed and the number of people falling off the roll is not even looking for employment any longer, so this is all about job creation, drives gdp, that drives the revenue to get this engine going. >> and no matter what happens,

we will see more austerity next year. it's pretty clear that we are going to see reduced government spending to some degree. we may very well see higher taxes. what is your expectation of the economy in 2013, based on that? regardless of whether or not we go over the fiscal cliff? >> from a gdp standpoint, i think, again, unless things really change significantly, i think we'll be lucky to get a 2% gdp in my opinion. >> tell me about your new firm, bob. x lr-8. what are you hearing what are you doing in terms of private equity? where are the deals that you see happening in the coming year? >> i've been focused mostly on midcap businesses and a lot of family businesses. it's amazing the number of family businesses now that are anxiously trying to monetize a portion of their business in anticipation of a higher tax rate. unfortunately, you know, they are also reaching a cliff because there is only so much time to try and find a buyer and match them up with a seller. there is an anxiety out there

among these family-held businesses and privately held businesses, that they are trying to get some cash off the table. >> sure. and they want to get that 15% capital gains tax as opposed to something that's much higher next year. that's what we're seeing selling. >> exactly. >> in the market. let's talk about autos for a moment. you used to run chrysler. you have a great sense of what's going on in the industry. we got word, we're looking at the auto industry, on pace for the best year in the last five years. do you think we're actually seeing a real recovery in autos? what's going on there? >> i do. i do. and i couldn't be happier, particularly for all my close friends and colleagues at chrysler to see, you know, the hard work we put in place during that transitional period really pay off in the form of -- you know, we had to make some really gut-wrenching decisions on cost. we put a number of new products in the pipeline that are resulting in tremendous margin for chrysler. i think financially they're on the road to recovery. it's interesting they are

financially bailing fiat out at this time. i'm very excited about the auto industry. >> great to have you on the program. >> thank you. >> thank you for joining us. up next on "wall street journal report," the conservative that says the january 1st fiscal cliff deadline isn't the end, it's just the beginning of the fight. anti-tax activist grover norquist on the road ahead for republicans and the economy. later, do artists make the best businesspeople, and how creative thinking can help you design the job of your dreams. as we go to break, take a look at how the stock market ended the week. we'll be right back.

welcome back. with two weeks left before year end, the looming fiscal cliff,

automatic spending cuts and tax increases set to go into effect, january 1 is stoking concern from washington to wall street. my next guest has been a key figure in the debate. grover norquist president of americans for tax reform. it's good to see you again. thank you for joining us. >> good to be with you, maria. >> since 1986, republicans have been sighing your taxpayer protection pledge. as we get closer to the fiscal cliff scenario, will some of the people who signed on to no new taxes have to concede and agree to revenue increases in the form of higher tax rates? >> well, obviously, the president is trying to drive in that direction. the republicans have some leverage as well. two years ago, obama said he didn't want to hurt the economy, so he didn't want to raise rates on anyone. evidently that his job is secure, he's less interested in everybody else's job, so he is interested in raising top rates, capital gains taxes, subchatter "s" corporation taxes. although that's going to be awfully rough on the economy if

he pulls the trigger on that. there are also a series of fights where republicans have more leverage than they do early january. that is the debt ceiling and there the republicans have announced ahead of time the boehner rule remains in place. obama wants a trillion dollars in debt ceiling increase and he's planning on having $8 trillion in higher debt over the next decade, he has to pay for it with spending cuts of equal amounts. the republicans could require tax rates come down as part of a debt ceiling increase. a second tool republicans have and have employed against obama is the continuing resolution. >> yeah. >> because the democrats in the senate have not passed a budget in three or four years, we have a cr, continued resolution if that isn't continued march, april, the government has no money to spend. >> what about tax increases and the impact on the economy? is it really that big of an impact? what about giving in on something just to get a deal dub

done so we don't have this crisis of going over the cliff? >> what we're trying to do is make the economy better, not worse. and we're going to be living through four years of the obamacare -- trillion dollars of obamacare taxes coming this next decade, all of the regulations that the epa and others have been hiding until after the election. $150 billion of those starting to bite before the year ends now, after the election but before the year ends, massive regulatory burden hitting. we need to not do more damage to the economy and raising the capital gains tax has always hurt the economy, raising the dividend tax is going to be very bad for the economy. raising the taxes on subchapter "s" corporations is going to be damaging to the economy. we need to stop obama from doing more damage to the economy and that means not letting him raise those taxes. >> i do agree, the capital gains and dividend taxes probably have a much bigger impact than the ordinary income tax increase. because that will put a limit to

the amount of stock people buy and investments that they make. so i am -- i am with you there, but what about the president saying, look, i have a mandate, okay? i was elected. >> well, of course, the president has to remember that 86% of the tv ads that were run on his behalf in the last election were explaining that romney will give you cancer and was a man of low moral character. these were not ads celebrating tax increases and spending too much money. so he won a mandate not to be romney. okay, for four years, he doesn't have to be romney. but he didn't get a mandate to continue spending and raise taxed on the american people. he never talked about the obamacare taxes that will be taking place in january. as a matter of fact, he avoided talking about those, and, of course, the republicans won a majority of the house and they did vote for a budget that reformed entitlements, cut tax

rates, that did dthe ryan plan, and everyone in the republican house twice voted for the ryan plan. the president never even written a budget that brought into balance entitlements and reform, let alone signed it. he can't advocate a secret plan. all of the budgets he talks about, the kind of spending restraint he wants credit for, a trillion dollars for not occupying iraq for the next decade. they kicked him out of the country. that's not a real budget cut, mr. president. >> what do you think this means for the future of the republican party? part of me feels like there's a stripe of extremism on both sides, but another part feels like this election was about abortion, it was about gay marriage, it was about the social issues that the extreme right in the republican party gets in the way of those centerists, those people who are maybe economically conservative, but socially liberal. >> it was an effort by the democrats and obama to talk

about everything except for the economy. if you are looking at the lousy job numbers they have, the lousy recovery and the lower standard of living, it was wise of them to talk about sex instead of about jobs. and the republicans did not do a good enough job focusing and keeping the focus on economic growth, the missing economic growth of the four obama years. >> all right. we'll be watching that. grover, good to have you on the program. thank you very much. >> good to be with you. >> we'll see you soon. grover norquist with us. up next, is an art degree more valuable than an mba? how to get ahead, stay ahead and how to find the best careers in the changing job market. we cut to the art of the deal, next. look for us on facebook, facebook/mariabartiromo. we're back in a moment. if you think running a restaurant is hard, try running four. fortunately we've got ink.

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welcome. here is a question. do artists make better business people in today's rapidly changing job environment? creative thinking is one of the skills in highest demand. robert safian is the editor ofa" magazine, and peter varna is with us. good to have you both on the program. >> thank you. >> thank you for joining us. bob, you've written a lot about the emerging generation of business leaders and call them generation flux. >> yes. >> what does that mean? what are the skill sets or personality traits most important for success in the new normal? >> in generation flux, describes the kinds of people best equipped to thrive in a time

where things are changing at a pace that is a breakthrough. we have not had a pace of change in a business world like this in a long time and requires a different kind of flexibility and adaptability, a lot of business has been built around efficiency, but adaptability and flexibility will be increasingly important as you try to adapt to the model shifts. that are going on around us. >> that's a great point. adaptability is so critical. business school applicants are down, right? for the fourth year in a row. you have students seeking masters of fine arts degrees. that's moving up in numbers. are we entering an era from mf mfas are worth more than mbas? >> a creative trade, which is adaptable, solving problems that you don't know they exist yet, in that kind of environment, the

longevity of a career is much longer. in other words, have you a process for approaching problems. not necessarily optimization but approaching problems. that's an important part of it, and i think that students are recognizing that the adaptability will be part of their career. they are likely not to spend the entire career with one company. but doing a range of things. >> how do you prepare for that? >> you give them a lot of problems that are not prescriptively defines, meaning they have to find the problem, find the sweet spot and create alternative solutions to those kinds of things. a lot of it has to do with not going in a linear way from a to b, but learning to find your way and be very comfortable with that. >> so let me ask you, what is the opportunity for creative thinkers then? question for you both, pratt institute is celebrating its 125th anniversary this year. some of our alumni have had incredible success in the business world. so what are the opportunities that some people may not expect,

bob? >> i think to some extent, our definitions of careers are outdated. we're still looking for a world where there's sort of a ladder that we move up to, that the next job is clear. instead of having multiple jobs in a career, we're going to have multiple careers in multiple industries over our lifetime. instead of having multiple jobs, we'll have multiple careers and multiple injuries, and the ceo used the term fio jobs. those are figure it out jobs. i don't know exactly what the answer is is what she's saying. they have to have the skills and are open to find new models of ways to figure it out. and that's what is happening at design schools. teaching a different way of thinking about how to adapt to prototyping through ideas as opposed to applying models. >> what do you think? >> absolutely. it's being comfortable with not quite knowing where you're going but watching it as it evolves, as what you're doing evolves. seeing people's reaction, and

it iterating it and being very comfortable with flux. >> we talk about uncertainty and ambiguity. uncertainty is you roll a device, one, two, three, four, five, six. and you can try to model that out as to what the answer's going to be. ambiguity is i don't know if it's a die. i don't know if there are numbers? are there colors? numbers? you have to have a different kind of training and thinking. >> do you think this creates innovators? >> go ahead. >> i think we need innovators, and i think in some ways we're following where the companies are going. you think two companies, think of barnes & noble, a retail company that has gone into the consumer electronics business with the nook. you have apple that's a consumer electronics company that's disrupted the retail business with the apple stores and itunes and app stores. what are they? what do we define them as? our definitions have broken down, and we need people who can see beyond the traditional ways of thinking about them, to break down and find the innovations that can take them to new

places. >> and you think we're educating them to do that? >> i think we are it's interesting, the comparison between an mfa and mba, it allowed us who run programs around mfas to examine what we do and why we do it in contrast. and to clarify, i think, what are the attributes. and one of the things we've recognized, entrepreneurialship does not necessarily have to mean create your own business or head it through your ipo, but the companies need people who act entrepreneurially inside the organization. >> fascinating stuff. great to have you on the program. peter, bob, thanks so much. >> thank you. >> we appreciate your time tonight, we'll see you soon. up next, the news for the upcoming week that will have an impact on your money. and then what had you talking, searching and shopping in 2012? tech giant google's year in review. back in a moment. this is america.

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we have some big news to tell you about beginning in january. we'll have a new name for the program. look for "on the money with maria bartiromo." we'll have some exciting new segments for you, great guests and of course, i'll be here as well. hope you will be there. here's some stories coming up in the week ahead that may move the markets and impact your money this week. oracle, nike and blockbuster, and r. r.i.m. all reporting third quarter earnings. and r.i.m. stock has been on fire ahead of the new device coming out. wednesday, how many residential units began construction with the latest housing starts figures. and thursday, busiest day for

u.p.s. 28 million holiday deliveries expected on thursday. and on thursday, the third and final revision of the gross domestic product. a market mover and on friday, the latest figures on personal incoming spending will be out as well as monthly consumer sentiment. what were 2012's hot searches? google released its annual zeitgeist. its list is capturing the mood and spirit of the united states this year. according to what we were searching for and talking about and looking for, top trending stock searches facebook, zynga, yelp, samsung and arena pharmaceuticals which develops anti-obesity drugs. interesting. and when hunger strikes, the most searched food companies were costco, pizza hut, dominos, papa john's, food network and weight watchers. proving those who dance eventually pay the fiddler. thank you so much for being with me. we'll take a look at hot holiday toys with toys "r" us ceo gerry storch. keep it right here. where wall street meets main

street. see you next week. have a great week, everybody.